Europa Oil & Gas (holdin... Share Discussion Threads

[currypasty] 29/7/2018 22:22

Europa Oil & Gas (EOG): UK portfolio strongly underpins shares

Key data
•Share price (p): 4.2
•Target price (p): 60.0
•Market cap (£m): 12.5
•Enterprise value (£m): 10.2

Ignore Ireland and its major upside potential from medium-term exploration. Europa is now trading at a hefty discount to the value of just its UK business, where planning approvals are progressing. Success in the coming months would prove a material catalyst. Meanwhile, the prospects for the completely overlooked Irish exploration portfolio will continue to improve as confidence returns to the space.

Jonathan Wright | [e-mail]

[currypasty] 29/7/2018 22:21

Thanks for the summary Jus.

[guesswhosback] 29/7/2018 12:39

Good post Jus thanks for taking the time.

[itsriskythat] 29/7/2018 12:16

Jus, it was a good read for a Sunday morning.

Hugh's a known hard worker. The time this plan takes to evolve and the outcome still depend on many things outside of his control.

Also needs some luck with Wressle. Lot of money invested there already about £5m gross to the Wressle partners.

[hermana3] 29/7/2018 11:50

Jus, Excellent summary of Hugh's strategy. Will we ever see the day when O'Cathain buys a few here?

[hermana3] 29/7/2018 11:50

Jus, Excellent summary of Hugh's strategy. Will we ever see the day when O'Cathain buys a few here?

[jusmasel99] 29/7/2018 10:17

Recap of where we stand including speculation and my own assumptions...

Corrib / Inishkea

We own the licence to the remainder of the original Corrib discovery licence.

Right now this is the real jewel in the crown as far as I am concerned. Since we were awarded the licence much has happened and been discovered. From what I hear Hugh applied for the licence on a whim and was surprised that they got it. At the time the details of well 18/20-7 were secret and only became available last year and we now know that Shell found gas in the well and stopped drilling before the bottom of the reservoir was reached .. the following year they went back to the same area and performed a sub sea survey and followed that up with 3D seismic as the same time they were evaluating the corrib reservoir. That 3D seismic becomes available to purchase soon. Bear in mind that while all this was going on Shell pulled the plug on Ireland and stopped all further exploration while putting Corrib up for sale and relinquishing the remainder of the licence. Now CPPIB are buying out Shell Eire (confirmation expected soon) and Vermillion are taking over the operatorship. My research found that CPPIB are not averse to investing further in Irish Offshore including Exploration while Vermillion have confirmed to me that they are planning 3 new wells into Corrib reservoir in 2020 to boost production but what is interesting is that they have said they are considering drilling deeper to explore for additional reservoir. Link that to what Hugh has mentioned about what they know about the 18/20-7 discovery and that they think there is a chance of additional prospects underneath a proven gas discovery in our licence then Vermillion's well could be a real bonus if successful.

On top of all this, brexit is imminent, Irish energy strategy - even if moving to renewables which they are very slow to do - relies heavily on Corrib and as that declines the dependence on UK Gas imports heightens which is useful leverage when negotiating Irish Borders I suppose ...

So we know why further exploration at Corrib stopped all of a sudden and we know that Eire would dearly love to have additional own gas resources - but we also know that it took 15 or so years to get Corrib into production which has many implications but most importantly it really puts the boot into the prospect of any further investment into gas production infrastructure .. e.g. LNG terminals in Cork which makes Corrib possibly the only chance for ireland to increase their own production through exploration....

And then of course the 'complete co-incidence' of two new directors joining the board in January - both of whom were involved in the original Corrib discovery and who accepted options triggered by a 10p share price to do so. Both have been remarkably silent and only one has bought shares in the company since then (possibly the only downside to my observations about Inishkea) but if you are a positive thinker like me you will trust that before too long they will prove Hugh right for bringing them on board....

One thing that keeps getting overlooked is the fact that Hugh keeps repeating that they will drill next year and I don't hear any mention of that depending on a farm in prior to starting the process. PVR did the same last year and did quite well via financing and farm ins eventually.

All this is out there .. you can check if you want .. the speculation is mine alone but that is why I invest here as a speculator .. in my mind it is inconceivable that further exploration in and around Corrib will not take place sooner rather than later and EOG are in the prime position to take advantage.

[tommy241] 28/7/2018 18:05

Courtesy of Porkpies from LSE:

[itsriskythat] 28/7/2018 11:16

Well, at least it's easier to operate offshore Ireland.

[itsriskythat] 28/7/2018 11:15

Seems there more trouble up North ..



"Onshore oil and gas operations are dangerous and polluting at every stage including the exploratory drilling phase. Not least is the flaring of waste gas containing multiple toxins and carcinogens. Production stage involves mechanical and chemical procedures which are hazardous and poorly regulated. These pose threats to human health and wildlife habitats, bringing negative impacts to the environment locally and globally.

Allowing this kind of industry into our precious rural spaces was given inadequate consideration. We know it is time to bring all fossil fuel activity to a stop! Please we ask for your help in this urgent appeal. If we raise £10,000 by the end of the month we can submit our case - already prepared - that exploration for oil, with potentially invasive production methods ahead, SHOULD NOT BE PERMITTED HERE."

So £10,000 needed to request judicial reviews of both Biscathorpe and N Kelsey approvals.

PS> The bit about hazardous and poorly regulated was below the belt.

[itsriskythat] 28/7/2018 10:51

"Direct action resistance doesn’t have to be about breaching the peace. In my experience, it was about a large group of passionate, inspiring and motivated individuals coming together to protect something bigger than themselves. It was about dancing on the side of the road, watching documentaries, sharing stories, and spreading love."

I'm only here to share and spread the love.

:)

[dunderheed] 27/7/2018 20:01

You'll probably sit tight till 12p!

[thetoonarmy2] 27/7/2018 19:47

Curry me to mate 6p breakeven will I have the sense to dump em or will greed takeover and i just sit tight for 9p ?

[christy41] 27/7/2018 15:58

You're not alone CP,anyway nice to end the week with a change of share price direction and a little bit of positivity surrounding Europa....

[currypasty] 27/7/2018 15:40

5p ASK on a roll, Im only a penny down on my placing shares now...lol

[currypasty] 27/7/2018 12:07

Our mcap is 14m at 4.7p.. even paying the equivalent of 30p is still less than £100m, and chicken feed to a major surely

edit, we really are a little tiddler at £14m, most of our peers are way over that, ukog £105m, igas, £140m

[jusmasel99] 27/7/2018 12:04

Our Irish Assets are held in two subsidiary companies so I suppose either or both could be bought out while leaving the core UK assets intact. Not sure how Hugh would value them at this stage but given they represent the major part of our prospect of achieving a 30p per share I am sure they would have to cough up a considerable amount..

[currypasty] 27/7/2018 12:02

I hope the large sellers is now out, or holds the rest now we are in spitting distance of some actual progress

[currypasty] 27/7/2018 11:12

is there a possibility that after seeing the data room, some major would just buy us out rather than fart about with the farm in process?

[currypasty] 27/7/2018 10:44

thanks jus, very encouraging

[jusmasel99] 27/7/2018 08:59

We expect that this level of activity will lead to increased interest and further potential activity in the near term. Drilling is currently scheduled to return to the basin in 2019, when Nexen will drill its Iolar prospect in LO 16/7 and Woodside plans to drill the Beaufort/Ventry gas prospect in FEL 5/13.

[jusmasel99] 27/7/2018 08:47

Most positive piece of trade opinion yet ...

hxxps://www.rigzone.com/news/blog_can_europa_get_a_farmin_partner_at_fel_313-26-jul-2018-156422-article/

Europa Oil & Gas (Holdings) plc revealed July 12 that it had launched a farm out process for its FEL 3/13 license in the South Porcupine Basin in Atlantic Ireland – but how likely is it that the company will get a partner for its operated asset?

Very, in my opinion.

On June 5 the company announced the near doubling of its estimate of gross mean un-risked prospective resources at FEL 3/13. This estimate rose from 1.5 billion barrels of oil equivalent (Bboe) to 2.9 Bboe, following the completion of pre-stack depth migration reprocessing of 3D seismic data originally acquired in 2013.

In its upgrade announcement, Europa said it intended to launch a farm out process for the license but revealed nothing about whether there had been any interest from companies for such a move.

When asked by Rigzone if Europa had received company interest for the farm out of FEL 3/13, a Europa spokesperson said that there had been interest in the farm out in early June, despite a farm out data room being weeks away from opening.

Just over a month after Europa’s upgrade revelation, Elaine Reynolds, an analyst at Edison Investment Research, said the near doubling of the FEL 3/13 prize will “undoubtedly” have increased interest in the company’s acreage.

“By almost doubling the prospective resources in FEL 3/13, Europa will undoubtedly have increased interest in its acreage from potential partners,” Reynolds told Rigzone.

The Edison Investment Research representative also stated that the license is “certainly in the right postcode to attract farm in partners.”

“With the entry of majors such as ExxonMobil and Statoil in the 2015 Atlantic Margin round and Total through farm-ins in 2017, consolidation in the basin is continuing and industry interest in the region remains high,” Reynolds said.

The analyst did however comment that it may take “some time” before a deal occurs.

“The Total and Cairn farm-ins to Providence Resources’ FEL 2/14 license containing Druid/Drombeg came only weeks before the well was spudded,” Reynolds said.

Based on the above, I believe Europa shouldn’t have too much trouble finding a partner for FEL 3/13. As Reynolds highlighted though, it could be a while before we see any development on a deal.

Europa owns a 100 percent stake in the FEL 3/13 license, which covers an area of 782 square kilometers (302 square miles). The prospects within the license have been identified as Wilde, Beckett and Shaw.

[guesswhosback] 27/7/2018 08:14

Sophisticated but poor.

[jusmasel99] 26/7/2018 17:47

Mr Cp - EOG once had such a following - all to do with the optimism surrounding the 'next best thing' after an IPO. We are old news as far as that goes and unless we appoint David Lenigas to the board it will remain so. Sophisticated investors remain here - the unsophisticated are chasing dreams elsewhere.

Wressle - no matter when it eventually comes into production as it surely will - is the back stop to this share price It can go lower and it can go considerably higher on news from Ireland - but if that does not arrive Wressle will provide the income and news flow to at least maintain our current Mcap.

Other opportunities will arise to boost the share price in due course including perhaps Holmwood where it could be pointed out to ANGS investors that EOG is a better bet on the success of that well.

[currypasty] 26/7/2018 15:46

I cant work out why angs has such a following, and they don't see any read across to here